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The Constantly Growing Adult Education and Online Degree Market

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As Richard Garret's interview suggests, there continues to be increasing interest in online education. According to a recent study, 25% of all US collegians took an online course last year—a statistic leading us to ask the question: When will it peak?

The answer? Not anytime soon, especially if you consider recent news. University of Phoenix, the bellwether of the online education companies, just recently reported very positive financial results. For the last quarter of 2007, the company that operates the University of Phoenix posted a 22.8 percent rise in quarterly earnings (profits), which exceeded stock analysts’ forecasts. The revenue growth was supported by an 11.4 percent increase in total degree enrollment to 325,000, as well as tuition increases in certain geographic areas and programs.

To learn more about the current market trends in adult and continuing education, EducationDyanmics recently held a series of focus groups with adult learners, with the primary demographic involved in online learning. The participants were adults, all with at least some college education who were interested in pursuing further education. Four sessions were held in two cities and the results, while far from scientific, suggest that there is still plenty of growth ahead for the continuing education market. That said, focus group data also implies great challenges remain in serving these students well.

For the adult learner, THE number one motivator in returning to school is economic. Adult students want to leverage a degree to "decorate their resume" and advance their career. In this small, random sampling, 90% of the prospects cited better paying jobs as the reason to get a degree. At the beginning of the session, when asked if they were open to taking an online degree, about 1/3 indicated an interest. In one group, two students were already enrolled in an online degree program and the sidebar conversations during the session seemed to draw some of the skeptics to consider online education as an option.

Another interesting observation came from the number of schools that prospective students considered. When last applying to a college, one-third of the participants considered only one school, while the rest of the group considered two or three schools. None of these adult learners applied to more than four schools, even those that were currently enrolled in an online program. This result differs from the traditional full-time student who, according to current trends, will apply to over ten schools.

When pressed as to why these current and prospective adult education students would choose to pursue on-campus learning versus online learning, responses showed a direct correlation to the individual’s comfort with computers and technology. Each of the participants said they used the Internet on a daily basis, using Google as well as sites like CraigsList.com and Yahoo. But the respondents who said they would prefer to use a paper-based application to college also seemed to be the students who wanted to be on campus. Further probing showed that people who participated in online chat and social networks like Facebook.com were at ease with an online application to college and were more willing to consider an online degree.

An active discussion about online applications to college followed. Most of the participants had had an experience with an online college application, and they provided the researchers with some interesting data on usability. For the older adults, completing the online application was rarely done alone; quite often their children assisted them in the process. They complained about the confusing language on the online application and would have enjoyed support in the form of glossaries, links to additional resources and a "help desk" phone number to provide them with quick answers to the online application process.

Everyone in the session agreed that part of what makes going to college attractive is meeting and interacting with people. Career was the primary reason to start, but all seemed to convey that socialization with other people was critical in the mix. When the discussion of online versus on-campus education turned to the social aspects of college, there also seemed to be a correlation between the people who used computers in their socializing and those who were interested in online education. While the online students seemed very comfortable in making friends through the computer, those preferring on-campus classes preferred face-to-face interaction.

As for trends, these focus groups show that people who view their computer as vital to their current way of life are by far more likely to succeed with online education. Those that can use a computer, but feel it is less vital, need support to succeed. The latter group seems to be larger in number and in need of a higher level of support than is currently available in the market today. Online education's next frontier may be less tied to hybrid teaching models and geared more toward hybrid service models. If traditional schools are going to succeed in this education space, they need to capitalize on their rich heritage of in-person service and modify their interface with adult students. We see that University of Phoenix has.

Phoenix views retention very much as a customer service issue. One stock analyst reports on an “early alert system,” which is an automated process that allows an instructor to indicate early on in the student’s life cycle any weakness they are seeing in the student’s experience (e.g., if the student does not turn in an assignment or is not participating in class discussions, etc.). The report is sent electronically to the student’s academic counselor who then conducts an “intervention” to find out if the problem can be remedied.

There seems to be growing interest in online programs with reporting features as 80% of Apollo's new students are electing to take classes online as opposed to on-ground. This rate is up from 65% just one year ago. Apollo offers its programs at over 100 regional campuses nationwide as well as online.

No show rates for the fourth quarter were close to 40%, much higher than the historical 20%. With 67,400 new students in the quarter after this 40% no show rate, the enrollment engine at Apollo is clearly humming!

The company reports conversion rates and retention are higher in specialized offering versus more general studies. Efforts to create new, unique program concentrations are currently increasing.

What seems to become clear in these reports is that Apollo views their students’ success as good business. Classroom success that leads to career success is what drives an ever-increasing amount of students to enroll in their programs. Traditional schools should take note of some of these successful practices to better serve their customers—the students.

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Additional sections of this journal address student recruiting and student retention. We have also placed all articles with a common theme of Innovative Practices in Communicating with Students in a separate portal. New articles will be posted each Monday, please check back by bookmarking this site or placing a link to this online education and distance education programs portal.

Mark Shay is the founder of EDU - a leading academic advertising provider, - part of Halyard Education Partners, a leader in student lead generation and enrollment management services.